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January 23, 2006

Doctors Hospital’s Medical Equipment Sold at Auction

by Sam Savage

By DEAN OLSEN STAFF WRITER

Beds, medical instruments and X-ray machines from the former Doctors Hospital will end up in hospitals, medical clinics and veterinarians' offices around the globe after thousands of items from the bankrupt facility were sold at auction this week.

"American-made is still very sought after," said Dana Smith, 47, owner of KMA Remarketing Corp., who drove to Springfield from DuBois, Pa., to buy $75,000 worth of medical equipment during the daylong auction Wednesday.

Doctors Hospital, a former for-profit facility owned by investors in Springfield and elsewhere, competed with the two downtown hospitals for 28 years but closed in 2003. The financial collapse of the 177-bed hospital at 5230 S. Sixth St. put about 400 employees out of work.

The four-story Doctors Hospital building covers 107,000 square feet and is owned by Springfield's Universal Guaranty Life Insurance Co. Universal, which is trying to find a buyer for the structure, acquired it after buying Doctors' $10.7 million mortgage loan for a discounted price in 2003.

Universal had hoped to sell the building to Pennsylvania-based Select Medical Corp., which wanted to renovate and reopen it as a long-term acute-care hospital. But that deal fell through in September when the Illinois Health Facilities Planning Board denied Select's request for a "certificate of need."

St. John's Hospital owns the medical office building that's attached to Doctors. Several doctors still work there, although the building is for sale.

Universal sold the contents of Doctors Hospital to Los Angeles- based Great American Group for an undisclosed price, according to a Universal official who asked that his name not be published.

Great American officials, who wouldn't reveal the price they paid, travel around the United States selling items from doctors' practices and hospitals that have closed.

Re-sellers such as Smith, along with central Illinois hospitals, doctors, nursing homes and members of the general public showed up for the auction in the former cafeteria of Doctors.

The prices they paid represented discounts of 10 percent to 90 percent or more compared with what the material would cost new.

Some of the items might have sentimental value to many Springfield-area residents: the beds where a loved one died or the high-back chair where visitors spent many hours sitting patiently with a sick friend.

But thousands of groups of the items - even pots and pans from the kitchen - were flashed on a screen and sold amid the light- hearted, rapid-fire delivery of auctioneers.

In addition to the 100 people bidding in-person, about 250 bidders participated in a Web simulcast of the auction, according to Great American Group officials who ran the auction.

Some bidders using the Internet were from as far away as Peru and Egypt, and one bidder was planning to use items he bought to furnish a hospital in Puerto Rico, said Roy Gamityan, senior vice president of wholesale and industrial services for Great American Group.

The most expensive item sold was a computerized tomography scanner that went for $40,000 and will be shipped to the Puerto Rican hospital, Gamityan said. The items even included some bone saws for amputating limbs and metal pins for repairing broken bones.

Smith said American medical equipment often becomes unusable in the United States as rapidly changing federal regulations make it obsolete. Overseas medical clinics are more than happy to snap up the stuff at a discount, he said.

The surgical instruments he bought will go to U.S. hospitals and schools that teach operating-room techniques, he said. Some of the instruments and equipment will be resold to buyers in China and the Philippines, he added.